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Photo Courtesy - ABC News (WASHINGTON) -- President Obama Friday signed into law an agreement to extend Bush-era tax cuts for two years, ending with the stroke of his pen a bitter schism in his own party and heading off what could have been a major standoff with Republicans.

The president hailed the bipartisan effort, acknowledging that both parties compromised on the deal by extending both tax cuts for the wealthy and benefits for the unemployed.

"It's a good deal for the American people. This is progress and that's what they sent us here to achieve," Obama said before an assembled group of lawmakers from both parties.

Lawmakers from both sides of the aisle "did what was right for the country," despite what he called "occasional political discomfort" from partisans who thought the deal made too many concessions to one party or the other.

The deal, which continues to give tax breaks across incomes and extends unemployment benefits , was hashed out by the president and the Republican leaders earlier this month.

The tax cuts would have expired Jan.1, resulting in average Americans paying thousands of additional dollars in taxes next year. A key concession by the White House was letting the Bush tax cuts for the country's top earners be extended, although the president had previously denounced giving cuts to wealthy Americans.

House Democrats initially said the deal gave Republicans too many concessions and vowed to keep it from coming to a vote. Just before midnight Thursday, however, the House passed the $858 billion package with strong bipartisan support, 277 to 148.

Despite what last week was called a Democratic insurrection, more Democrats than Republicans ultimately supported the deal.

"It's a good first step, but let's be clear, if we actually want to help our economy get back on track and to begin creating jobs, we need to end the job-killing spending binge. We need to cut spending significantly and we need to provide more certainty to small businesses around America," House Speaker-designate John Boehner, R- Ohio, said before the signing.